The phrase "planning ahead" perfectly describes the current state of the power battery recycling market. The next five years will see a peak in power battery recycling due to the large-scale retirement of existing batteries. However, industrializing power battery recycling remains a challenge for the industry.
"The recycling of power lithium batteries cannot be limited to a single company; it requires a comprehensive approach, working with upstream and downstream enterprises to promote recycling. Simultaneously, the mechanisms for power battery recycling must be considered," said Sun Yanxian, Chairman of Zhejiang Chaowei Chuangyuan Industrial Co., Ltd., in his speech at the 4th China Renewable Resources Recycling Industry Conference in 2017. Since its promotion began in 2009, my country's electric vehicle industry has developed for seven years. With strong government support, the new energy vehicle market has experienced explosive growth in recent years. According to statistics from the China Association of Automobile Manufacturers, sales of new energy vehicles in China reached 507,000 in 2016, and this year's market sales are expected to be around 800,000 units.
The lifespan of power batteries is generally 5-8 years. This means that starting this year and next, my country's power batteries will enter a large-scale scrapping period. By 2020, the cumulative scrapped volume of automotive power batteries in China is expected to reach 200,000 tons. Furthermore, with the development of new energy vehicles and the passage of time, the pressure on power battery recycling will increase. Cao Hongbin, a researcher at the Institute of Process Engineering, Chinese Academy of Sciences, stated that electric vehicle batteries may be scrapped after three to five years of use. If automotive power batteries are not properly recycled and processed after retirement, it will not only waste resources but also pollute the environment. The process of power battery reuse generally involves dismantling, testing, and screening used batteries, followed by secondary recombination for reuse. However, due to the large size and high energy density of power batteries in new energy vehicles, the recycling process is relatively dangerous. Because power batteries involve heavy metals, electrolytes, and environmental issues, every step is crucial for their recycling and reuse.
Furthermore, because the batteries received by recycling companies come in various forms, sizes, specifications, and packaging types, dismantling involves multiple packaging fixtures, making it difficult for companies to achieve large-scale batch dismantling. The recycling and utilization of power batteries still faces the challenge of large-scale implementation. Yu Haijun, General Manager of Hunan Bangpu Scrap Car Recycling Co., Ltd., stated this. Although power battery recycling is difficult, the government has introduced some supportive policies and launched pilot programs. More and more companies are beginning to focus on power battery recycling. In addition to companies like Shenzhen GEM and Ganfeng Lithium establishing professional power battery recycling companies, power battery companies including BYD, Wotema, Guoxuan High-Tech, CATL, CALB, and BAK have all established market presence in the power battery recycling field. There is an urgent need to standardize the power battery recycling system. During the first phase of new energy vehicle promotion from 2008 to 2012, fewer than 30,000 new energy vehicles were sold, and about 80% of them were buses. Typically, new energy vehicles need battery replacement after about 5 years. For high-frequency use models such as taxis and buses, the need for battery swapping may be shortened to 3 years. my country's new energy vehicle market experienced a concentrated boom in 2015, so a large-scale battery swapping wave is expected to arrive after 2018. However, even before the large-scale retirement of power batteries involves post-retirement issues, a comprehensive system for the recycling of power batteries must be established in advance, said Sun Huajun, deputy director of BYD's battery plant. This is because once the power battery market enters a period of rapid retirement, these batteries will face disuse and disorganization. Currently, my country's power battery recycling still faces many problems.
First, there are no mandatory laws or policies. Although the government has successively issued some policies and regulations, there are no regulations that truly implement responsibilities and clearly define penalty details. Second, the industry is fragmented. There are many types and specifications of batteries, many manufacturers, many car companies, and scattered recycling companies, all of which are not conducive to the centralized and large-scale recycling of power batteries. Third, distribution channels are difficult, and the market is immature. Although the issue of power battery recycling is urgent, my country's power battery recycling industry is only just beginning to enter its peak period, so the market is not mature, and small and medium-sized enterprises face difficulties in sourcing supplies.
Furthermore, cost and profitability are undoubtedly major obstacles to battery recycling. High recycling process costs and low recycling value deter many companies and investors. Moreover, cathode materials such as anodes, lithium manganese oxide, and lithium iron phosphate are inherently inexpensive, lacking the economic incentive for recycling and making it difficult to guarantee the recycling rate of power batteries, as well as resource and environmental protection. Zhang Tongzhu, a senior engineer at the Automotive Standardization Institute of the China Automotive Technology Research Center, stated that achieving economies of scale is a crucial breakthrough for current power battery recycling. There is an urgent need to establish a power battery recycling system and industry alliance. For the industry, this would facilitate economies of scale and more centralized and effective recycling, benefiting the overall development of the industry and resource and environmental protection. For battery manufacturers and automakers, it would solve their own battery recycling problems without needing to establish additional recycling facilities, thus reducing operating costs.
